When the world's best-known historian turns his attention to today's political problems, it's worth listening. Eric Hobsbawm celebrated his 90th birthday this summer with a book of essays, Globalisation, Democracy and Terrorism, in which he surveys the world since 9/11, imparting lessons "the author has learned, not least from living through and reflecting on much of the past century".

As a scholar who not only has been a formidable presence in the historical profession since the 1940s, but can say that he "remembers vividly" the cold winter night Hitler took power in Berlin, Hobsbawm feels qualified to stand back from the contemporary scene and see it "in a broader context and in a longer perspective". And his standing has never been higher, thanks to his two previous books: the bestselling account of the "short 20th century", The Age of Extremes (1994), which has been called his masterpiece; and his memoir, Interesting Times (2002), the writing in which surpasses the already exacting standards of a renowned stylist. Hobsbawm's range and power of analysis are unquestioned. He speaks numerous languages, has travelled everywhere and is equally at home assessing football's Bosman ruling as he is explaining stock market crashes. Even the Spectator, a magazine assuredly hostile to his unrepentant communism, calls him our "greatest living historian".

He is pleased to have reached 90: soon it won't be that unusual, he points out, but for now it has a certain "scarcity value". Hobsbawm wants to help us see beyond "current passions and sales pitches" - be prepared, however: he has no truck with liberal pieties. "More nonsense and meaningless blather is talked in western public discourse today about democracy than about almost any other word or political concept," he insists. "Fundamentalist Islam isn't a danger, if only because it can't win any wars." Young, "fundamentalist bomb-throwers", he says, are nothing compared to the IRA. He dismisses the idea that the UN has any independent authority, and has no time for humanitarian interventions: "the default position of any state is to pursue its interests".

Hobsbawm assesses current dilemmas with a coolness and detachment that his political opponents have been quick to identify as an unfeeling, mandarin Marxism. Touchy-feely is not his style; he follows, he says, the traditions of Enlightenment rationalism and is frustrated with recent "hysterias" and the "totally unstructured feeling that 'something must be done'". His aim, he writes, is to assist the young "to face the darkening prospects of the 21st century . . . with the requisite pessimism".

His prognosis certainly isn't cheerful. He talks of the "extraordinary instability of the new global economy". The new American imperialism is doomed to fail. He fears more pronounced economic inequalities within nations and an increase of xenophobia in the west, and can see little future in green politics because it "appeals only to prosperous people: the more money you have, the more aware you are of the problems of the environment, but the bulk of the population of the world aren't in this position". Referring to the economic and technological shift of gravity from the west to India and China, he invites acknowledgment that "what is going to happen is quite clear": sooner or later we will wake up to the fact that we "have been living like princes", and that it can't last.

It seems as though the modern world is not much to Hobsbawm's liking. One aspect of his conversation and recent writings is a nostalgia for the years between 1945 and 1975 - les trente glorieuses - when the cold war imposed some order on world politics and nation states had yet to be weakened by the neoliberal global economy. He has been acerbic about the achievements of the 1960s: "It wasn't a political or social revolution. It was more a spiritual equivalent of a consumer society - everybody doing their own thing. I'm not certain I welcome this." He has never worn jeans. And with the disappearance of the industrial working class in mind, he talks of living through the "historic moment when the rules and conventions that had hitherto bound human beings together in families, communities and societies ceased to operate". Very few people are able to earn their living "decently" any more.

All this is said with a matter-of-fact gloominess. Hobsbawm nevertheless looks keenly for more hopeful signs, and his reputation for unemotional aloofness is belied by the sunny way he talks about recent events in Westminster. "Gordon", he says, will be an "enormous improvement" on Tony Blair ("Thatcher in trousers") because he knows the traditions of the labour movement and has a sense of "social justice and equality". It is belied, too, by his well-known sociability. Not one, but three 90th birthday parties were organised for him, and his home on the edge of Hampstead Heath, where he lives with his second wife, Marlene, has long been a kind of "salon" attended by famous friends from around the globe, who attest to the Hobsbawms' hospitality and the free flow of drink.

Several passages in Interesting Times make clear that Hobsbawm's political formation couldn't have been more emotionally charged. It is fitting that a man who has been so closely identified with the "dream of the October revolution" should have been born in 1917. After his parents died, he moved in 1931 from Vienna to Berlin, to stay with an aunt and uncle. This was "the year the world economy collapsed, the historic moment that decided the shape of both the 20th century and my life". In January 1933, Hobsbawm marched as a youthful socialist through the night - "chanting, singing" - in a desperate response to a mass parade by Nazi stormtroopers. "Next to sex," he has written, "the activity combining bodily experience and intense emotion to the highest degree is the participation in a mass demonstration."

Three years later, by which time his family had moved to England, Hobsbawm was in Paris for "the greatest of mass demonstrations of the French left" - the celebrations on Bastille Day of the victory of the Popular Front. The left was united against fascism and the march was "unforgettable . . . one of the rare days when my mind was on autopilot. I only felt and experienced. That night we watched the fireworks over the city from Montmartre and, after I left the party, I walked back slowly across Paris as though floating on clouds, stopping to drink and dance at I do not know how many street-corner bals. I reached my lodgings at dawn."

Hobsbawm was an energetic communist at Cambridge in the late 1930s, but nothing in Britain could match the intensity of his continental experiences - except jazz, first introduced to him in Sydenham by a cousin. "Convinced of being sexually unattractive," he remembers, "I deliberately repressed my physical sensuality and sexual impulses. Jazz brought the dimension of wordless, unquestioning physical emotion into a life otherwise almost monopolised by words and the exercises of the intellect." In the 1950s, Hobsbawm would head to Ronnie Scott's after teaching in the evenings at Birkbeck - writing under the name Francis Newton, he was for a time the New Statesman's jazz critic. His proudest moment, he has said, was receiving an honorary degree alongside Benny Goodman.

The second world war had a particular impact on him: "In my days as a sapper I lived among workers - overwhelmingly English workers - and in doing so acquired a permanent, if often exasperated, admiration for their uprightness, their distrust of bullshit, their sense of class, comradeship and mutual help." Hobsbawm has admitted that he has, throughout his life, felt somewhat of an outsider, but these soldiers, referred to in Interesting Times as "the lads" and "my mates", must have reaffirmed his politics by accepting him as one of them. It is no coincidence that, writing history, he set out from the start to appeal to an audience beyond the academy, and all his books reflect his revolutionary, or at least left-wing, politics - though millions who have read them as set texts may not have been aware of it.

He was a pioneer of "history from below", an approach influenced by the social sciences, which dominated the profession for decades. Primitive Rebels (1959) and Bandits (1969) were about characters in the folk mythologies of different nations who opposed elite oppression - Robin Hood figures who were loved for championing the people. The Invention of Tradition (1983), edited with Terence Ranger, brilliantly explored how rituals and practices that claim to be innate and immemorial (from Scottish kilts to the British royal family) were in fact recently and deliberately developed.

But for years Hobsbawm was best known for his trilogy about the "long 19th century". If The Age of Revolution, The Age of Capital and The Age of Empire are shaped by one idea, it is the relationship between the successful emergence of capitalism and the development of both bourgeois society and political liberalism. Social transformations are interpreted as being driven essentially by economic change, but there is no clanking of dialectical machinery. Of course, the rule of capital didn't everywhere mean the smooth replacement of aristocratic governments, or an effortless triumph for liberalism: the old order ended only with the crisis of 1914.

Hobsbawm was a founder member of the influential Communist Party Historians Group, along with Christopher Hill, Raphael Samuel and EP Thompson, but whereas almost all of his fellow comrades left the party in the 1950s and 1960s, he chose to retain his membership, a decision that has raised awkward questions ever since. Why, after revelations about Stalin's torture chambers, and events in Hungary and Prague, did he not leave an organisation whose main point was to take direction from Moscow? The publication of The Age of Extremes sharpened this controversy, especially when, on BBC2's Late Show in 1994, Hobsbawm responded to the question whether 20 million deaths would have been justified to create a communist utopia by saying "yes". This response was later described as "disgraceful" by Martin Amis in his book Koba the Dread, and articles were written lambasting Hobsbawm as "Stalin's Professor".

The historian has taken great pains to clarify his position. "I cannot conceive how what I've written can be regarded as a defence of Stalin," he has said. He stresses, too, that communism was always much more than Stalinism, and took different forms around the world, in, say, Spain, Italy, South America and South Africa. If his decision to stay in the party could ever be satisfactorily explained, it would be in personal terms, ones that reach back to Hobsbawm's youth in Berlin and Paris: it was "quite simply more difficult" for him "to break with the party than for those who came later and from elsewhere".

Nearly two decades have passed since the end of the Soviet Union, and Hobsbawm is now less dogged by this controversy. He is so far from being shunned by the establishment for his views that he has been made a Companion of Honour. He no longer calls himself a communist because, "as a political programme", communism "is no longer on the agenda", but he still stands square against the "systematic attempt" to turn it into "a political pathology or a sin": it was a "good cause".

One thing he cannot rid himself of is "the lifetime habit" of wanting to "persuade as well as to expound". He urges the continued need for collective action, and demands that societies should be organised for the benefit of all people, not simply those who find success easy. As he enters his 10th decade, he reiterates the ringing injunction with which he ended his memoir: "Let us not disarm, even in unsatisfactory times. Social injustice still needs to be denounced and fought. The world will not get better on its own."